Since last spring the AICPA has been working on a non-GAAP financial reporting framework designed for America’s Main Street businesses and users of their financial statements. Earlier today, the AICPA launched the Financial Reporting Framework for Small- and Medium-Sized Entities. Visit aicpa.org/FRF-SMEs for more information and updates, and search #MainStFinancials on Twitter. Comments and requests should be directed to FRFforSMEs@aicpa.org.

Millions of private companies now have another non-GAAP financial reporting option

The AICPA’s new financial reporting framework designed for America’s small business community is now available and ready to use. The FRF for SMEs™ accounting framework delivers financial statements that provide useful, relevant information to owners of private companies and other stakeholders in a consistent, simplified, cost-effective way. In this video, Chairman of the AICPA Board of Directors Richard J. Caturano, CPA, CGMA, and AICPA President and CEO Barry C. Melancon, CPA, CGMA, explain the marketplace demand for the FRF for SMEs™ framework, the opportunity it presents for CPA firms’ clients and CPAs in business and industry, and the important features that address the concerns of owner-managed, for-profit smaller enterprises.

The FRF for SMEs™ framework will give small-business owners and users of their financial statements, such as banks and insurers, robust yet relevant financial information to make informed business or credit decisions. It also allows some optionality, so financial statements can be tailored to users’ needs. A principle-based framework, the FRF for SMEs™ accounting option enables CPAs to exercise their professional judgment, knowledge and skill, reinforcing their role as trusted business advisors.

Other special purpose frameworks, such as income tax or cash bases of accounting, remain and could be appropriate. Main Street businesses and users of their financial information looking for more comprehensive and consistent financial statements may want to explore the FRF for SMEs™ accounting option.

As the framework is not authoritative or required, it may be used immediately. Download a FREE copy of the framework to see whether it is the best financial reporting option for you or clients who do not need GAAP financial statements.

In late June, the AICPA will be providing a free extensive toolkit to help members learn about the framework and discuss it with clients. Additional free resources will educate small businesses and users of financial statements about the FRF for SMEs™ option. To inform the marketplace, the AICPA is conducting a targeted communications and advertising campaign to small business, bankers, insurers and others.

For more information on the framework, the resources below are offered: